India Ratings & Research (Ind-Ra) has affirmed NTPC's long-term issuer rating at 'AAA' with a stable outlook and short-term issuer rating at 'A1+'.

The affirmation reflects NTPC's dominant position in the Indian power sector with an 18.4% share on a consolidated basis and a 16% share on a standalone basis in the overall power capacity in India as of FYE13.

NTPC at a standalone level generated 232 billion kwh in FY13 (year end March), 25.4% of all India generation. The company achieved a higher plant load factor (PLF) of 83% than all-India average of 70% in FY13, although it declined from 91% in FY09.

The ratings factor in the low off-take risks for the power generated in NTPC's plants because of its low average selling price per unit (Rs 2.96/kwh), firm power purchase agreements, a geographically diversified customer and generating base and strong operational and strategic linkages with the Indian government.

The ratings also factor in the cost-plus regulatory regime under which NTPC operates its plants, ensuring stable cash flows with foreign exchange rate variations as a pass-through in tariff. NTPC through efficient operations has been able to meet the operating standards set by the regulator.

The ratings continue to reflect NTPC's financial flexibility emanating from its large cash balances (FY13: Rs 168 billion), comfortable net financial leverage (FY13: 2.5x; FY12: 2.5x) and access to domestic and foreign debt.

Shares of the company gained Rs 1.8, or 1.38%, to settle at Rs 132.55. The total volume of shares traded was 170,463 at the BSE (Wednesday).